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Covid fallout: With banks issuing takeover notices, HP hoteliers in dire straits
Many hotels in Himachal had to temporarily close due to dearth of working capital due to the Covid pandemic, takeover notices from banks, water, electricity and garbage bills have added to their woes
The tourism industry has been reeling due to the curbs imposed to arrest the spread of the coronavirus pandemic. In another setback, many hotels in Himachal have been served takeover notices due to non-payment of loans.
Hoteliers have been severely hit due to restrictions on interstate movement. Many hotels in and around Shimla had to temporarily close due to dearth of working capital, others could only list a few rooms. Tourism has been the primary mainstay for people in the hill-state, generating both direct and indirect employment. Lack of financial aid from the state government and the Covid-induced slowdown has left stakeholders in dire straits.
“Hoteliers are fuming as far from extending a helping hand, the government has asked them to pay water and garbage bills and property tax,” says Mohinder Seth, president, Himachal Pradesh State Tourism Stakeholder Association.
Other states such as Gujarat, Odisha, Maharashtra, Rajasthan and Punjab have given relief to hotel businesses by waving off taxes, or demand charges on electricity and other concessions for a year.
Hoteliers say the business is no longer viable in Himachal Pradesh. They say the Capital city was the worst affected as it is the only tourist destination in the state where the cost of water, property tax and garbage is highest, while the rent is the lowest due to the presence of a large number of hotels in and around Shimla.
The interest subvention scheme has only benefitted a few hotels, while small units continue to struggle. Some tourism units did benefit from the emergency credit line scheme, but tourism units who had availed loans after February were not benefitted.
